JP Morgan Reiterates "Neutral" Rating on McCormick & Co. (MKC)

JP Morgan Reiterates “Neutral” Rating on McCormick & Co. (MKC)


JP Morgan reported on Friday that it has maintained a “Neutral” rating on spice maker, McCormick & Co. (MKC).

Analyst Ken Goldman commented, “McCormick reported pro forma 2Q13 (May) of $0.61, in line with Street estimates. The top line grew 1.9% Y/Y, slightly lower than the 2.3% consensus. The gross margin was a bit lighter than the Street expected (39.3% versus 39.8%) and the SG&A margin was a bit lighter too (27.4% versus 27.7%). We are excluding $4MM in acquisition costs from our model. The Consumer segment’s top line grew 3.9%, in line with our expectation. The margin excluding the acquisition costs was 15.5%, 60 bps above our forecast. The Industrial segment’s revenues were down 1% Y/Y, lower than the +1% we had forecast. Sales continue to be impaired by QSR demand both in the US and China. The margin came in at 6.9%, 30 bps under our model.”

McCormick & Co shares were mostly flat during pre-market trading Friday. The stock is up 11% YTD.

The Bottom Line

Shares of McCormick & Co. (MKC) have a 1.93% yield, based on Thursday’s closing price of $70.59.

McCormick & Co. (MKC) is not recommended at this time, holding a DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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